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RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8784
Experience:  CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
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I received a 1099R showing $12K in Gross Annuity Amount.

Customer Question

I received a 1099R showing $12K in Gross Annuity Amount. The distribution code is 3-Disability. The Taxable Annuity shows "Unknown". Do I owe tax for this income?
Submitted: 6 years ago.
Category: Tax
Expert:  RD replied 6 years ago.

Are you under 59 1/2 years? What type of annuity is this?

Generally if the reason for the distribution is disability- than the distribution will not be subject to 10% early distribution penalty. You will, however, owe tax on the distribution amount. the tax will depend on your overall total income, filing status and tax credits.

 

 

Let me know if you have any question.

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
RD and 3 other Tax Specialists are ready to help you
Expert:  RD replied 6 years ago.
Please provide information regarding the type of the annuity.
Customer: replied 6 years ago.
Reply to RD's Post: The 1099R is for a "Statement of Annuity Paid" (if that makes a difference - it looks like there are at least 2 types of 1099R's). I'm under 59 1/2, but as you said this is for a disability.
Expert:  RD replied 6 years ago.
IS this a contribution that you made to a qualified plan (like a 401K deduction from your payroll-pre tax)?
Customer: replied 6 years ago.
Reply to RD's Post: It's a Federal retirement disability annuity. Is that what you mean?
Expert:  RD replied 6 years ago.

Are you a federal government employee?

Customer: replied 6 years ago.
Reply to RD's Post: No. I took a disability retirement after 25 years when I was 52. Minimum retirement age is 55 with 30 years.
Expert:  RD replied 6 years ago.

This will be taxable to you as discussed in the earlier post presuming that you did not make any after tax contribution to this plan.

 

Let me know if you have any question.

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

Customer: replied 6 years ago.
Reply to RD's Post: I did make contributions of slightly more than $31K to the retirement fund during my career.
Expert:  RD replied 6 years ago.

Yes, but if this is pre tax (which most retirement plan contribution are) than the entire amount is taxable when received.

Sorry I was away for some time.

Let me know if you have any question.

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

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